H.R. 6494

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6494 Introduced in House (IH)]

<DOC>

119th CONGRESS
1st Session
H. R. 6494

To amend titles XVIII and XIX of the Social Security Act to make 
improvements to the treatment of the United States territories under 
the Medicare and Medicaid programs, and for other purposes.

_______________________________________________________________________

IN THE HOUSE OF REPRESENTATIVES

December 5, 2025

Ms. Plaskett (for herself, Mrs. Radewagen, Mr. Hernandez, Mr. Moylan, 
and Ms. King-Hinds) introduced the following bill; which was referred 
to the Committee on Energy and Commerce, and in addition to the 
Committee on Ways and Means, for a period to be subsequently determined 
by the Speaker, in each case for consideration of such provisions as 
fall within the jurisdiction of the committee concerned

_______________________________________________________________________

A BILL

To amend titles XVIII and XIX of the Social Security Act to make 
improvements to the treatment of the United States territories under 
the Medicare and Medicaid programs, and for other purposes.

Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

(a) Short Title.--This Act may be cited as the ``Territories Health 
Equity Act of 2025''.
(b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
TITLE I--MEDICAID

Sec. 101. Elimination of general Medicaid funding limitations (``CAP'') 
for territories.
Sec. 102. Elimination of specific Federal medical assistance percentage 
(FMAP) limitation for Puerto Rico.
Sec. 103. Permitting Medicaid DSH allotments for territories.
TITLE II--MEDICARE

Subtitle A--Part A

Sec. 201. Calculation of Medicare DSH payments for IPPS hospitals in 
Puerto Rico.
Sec. 202. Rebasing target amount for hospitals in territories.
Sec. 203. Medicare DSH target adjustment for hospitals in territories.
Subtitle B--Part B

Sec. 211. Eliminating late enrollment penalties under Part B of the 
Medicare program for certain individuals 
residing in Puerto Rico.
Subtitle C--Medicare Advantage (Part C)

Sec. 221. Adjustment in benchmark for low-base payment counties in 
Puerto Rico.
Subtitle D--Part D

Sec. 231. Automatic eligibility of certain low-income territorial 
residents for premium and cost-sharing 
subsidies under the Medicare program; 
sunset of enhanced allotment program.
TITLE III--MISCELLANEOUS

Sec. 301. Medicaid and CHIP territory transparency and information.
Sec. 302. Report on exclusion of territories from exchanges.
Sec. 303. Access to coverage for individuals in certain areas without 
any available exchange plans.

TITLE I--MEDICAID

SEC. 101. ELIMINATION OF GENERAL MEDICAID FUNDING LIMITATIONS (``CAP'') 
FOR TERRITORIES.

(a) In General.--Section 1108 of the Social Security Act (42 U.S.C. 
1308) is amended--
(1) in subsection (f), in the matter preceding paragraph 
(1), by striking ``subsections (g) and (h)'' and inserting 
``subsections (g), (h), and (j)'';
(2) in subsection (g)(2), in the matter preceding 
subparagraph (A), by inserting ``subsection (j) and'' after 
``subject to'';
(3) in subsection (i), by striking paragraph (4); and
(4) by adding at the end the following new subsection:
``(j) Sunset of Medicaid Funding Limitations for Puerto Rico, the 
Virgin Islands, Guam, the Northern Mariana Islands, and American 
Samoa.--Subsections (f) and (g) shall not apply to Puerto Rico, the 
Virgin Islands, Guam, the Northern Mariana Islands, and American Samoa 
beginning with fiscal year 2026.''.
(b) Conforming Amendments.--
(1) Section 1902(j) of the Social Security Act (42 U.S.C. 
1396a(j)) is amended by striking ``, the limitation in section 
1108(f),,''.
(2) Section 1903(u) of the Social Security Act (42 U.S.C. 
1396b(u)) is amended by striking paragraph (4).
(c) Effective Date.--The amendments made by this section shall 
apply beginning with fiscal year 2026.

SEC. 102. ELIMINATION OF SPECIFIC FEDERAL MEDICAL ASSISTANCE PERCENTAGE 
(FMAP) LIMITATION FOR PUERTO RICO.

Section 1905 of the Social Security Act (42 U.S.C. 1396d) is 
amended--
(1) in subsection (b)(2), by inserting ``for fiscal years 
before fiscal year 2026'' after ``American Samoa''; and
(2) in subsection (ff)(2), by striking ``2027'' and 
inserting ``2025''.

SEC. 103. PERMITTING MEDICAID DSH ALLOTMENTS FOR TERRITORIES.

Section 1923(f) of the Social Security Act (42 U.S.C. 1396r-4(f)) 
is amended--
(1) in paragraph (6), by adding at the end the following 
new subparagraph:
``(C) Territories.--
``(i) Fiscal year 2026.--For fiscal year 
2026, the DSH allotment for Puerto Rico, the 
Virgin Islands, Guam, the Northern Mariana 
Islands, and American Samoa shall bear the same 
ratio to $300,000,000 as the ratio of the 
number of individuals who are low-income or 
uninsured and residing in such respective 
territory (as estimated from time to time by 
the Secretary) bears to the sums of the number 
of such individuals residing in all of the 
territories.
``(ii) Subsequent fiscal year.--For each 
subsequent fiscal year, the DSH allotment for 
each such territory is subject to an increase 
in accordance with paragraph (3).''; and
(2) in paragraph (9), by inserting before the period at the 
end the following: ``, and includes, beginning with fiscal year 
2026, Puerto Rico, the Virgin Islands, Guam, the Northern 
Mariana Islands, and American Samoa''.

TITLE II--MEDICARE

Subtitle A--Part A

SEC. 201. CALCULATION OF MEDICARE DSH PAYMENTS FOR IPPS HOSPITALS IN 
PUERTO RICO.

Section 1886(d)(9)(D)(iii) of the Social Security Act (42 U.S.C. 
1395ww(d)(9)(D)(iii)) is amended to read as follows:
``(iii) Subparagraph (F) (relating to 
disproportionate share payments), including 
application of subsection (r), except that for 
this purpose--
``(I) the sum described in clause 
(ii) of this subparagraph shall be 
substituted for the sum referred to in 
paragraph (5)(F)(ii)(I); and
``(II) for discharges occurring on 
or after October 1, 2025, subclause (I) 
of paragraph (5)(F)(vi) shall be 
applied by substituting for the 
numerator described in such subclause 
the number of subsection (d) Puerto 
Rico hospital's patient days for the 
cost reporting period involved which 
were made up of patients who (for such 
days) were entitled to benefits under 
part A of this title and were--
``(aa) entitled to 
supplementary security income 
benefits (excluding any State 
supplementation) under title 
XVI;
``(bb) eligible for medical 
assistance under a State plan 
under title XIX; or
``(cc) receiving aid or 
assistance under any plan of 
the State approved under title 
I, X, XIV, or XVI.''.

SEC. 202. REBASING TARGET AMOUNT FOR HOSPITALS IN TERRITORIES.

Section 1886(b)(3) of the Social Security Act (42 U.S.C. 
1395ww(b)(3)) is amended by adding at the end the following new 
subparagraph:
``(M)(i) For each cost reporting period beginning 
on or after October 1, 2025, in the case of a hospital 
located in a territory of the United States, there 
shall be substituted for the target amount otherwise 
determined under subparagraph (A) the rebased target 
amount (as defined in clause (ii)), if such 
substitution results in an amount of payment under this 
section to the hospital for such period that is greater 
than the amount of payment that would be made under 
this section to the hospital for such period if this 
subparagraph were not to apply.
``(ii) For purposes of this subparagraph, the term 
`rebased target amount' has the meaning given the term 
`target amount' in subparagraph (A), except that--
``(I) for a cost reporting period beginning 
on or after October 1, 2025, and before 
September 30, 2030, there shall be substituted 
for the preceding 12-month cost reporting 
period the 12-month cost reporting period 
beginning during fiscal year 2017;
``(II) for a cost reporting period 
beginning on or after October 1, 2030, there 
shall be substituted for the preceding 12-month 
cost reporting period the cost reporting period 
for which the target amount determined under 
subparagraph (A) is the highest among the 5 
cost reporting periods for which the Secretary 
has the most recent settled cost reports;
``(III) any reference in subparagraph 
(A)(i) to the `first such cost reporting 
period' is deemed a reference to the first cost 
reporting period following the 12-month cost 
reporting period beginning during fiscal year 
2017; and
``(IV) the applicable percentage increase 
shall only be applied under subparagraph 
(B)(ii) for cost reporting periods beginning on 
or after October 1, 2025.''.

SEC. 203. MEDICARE DSH TARGET ADJUSTMENT FOR HOSPITALS IN TERRITORIES.

Section 1886(b)(3) of the Social Security Act (42 U.S.C. 
1395ww(b)(3)), as amended by section 202, is further amended by adding 
at the end the following new subparagraph:
``(N)(i) For each cost reporting period beginning 
on or after October 1, 2025, in the case of a hospital 
that is located in a territory of the United States 
other than Puerto Rico and that would be a subsection 
(d) hospital if it were located in one of the 50 
States, the target amount shall be increased by--
``(I) in the case that such hospital has a 
disproportionate patient percentage of not less 
than 15 percent and not greater than 40 
percent, 10 percent; and
``(II) in the case that such hospital has a 
disproportionate patient percentage of greater 
than 40 percent, 10 percent plus 60 percent of 
the number of percentage points by which such 
hospital's disproportionate patient percentage 
exceeds 40 percent.
``(ii) For purposes of this subparagraph, the term 
`disproportionate patient percentage' has the meaning 
given such term in subsection (d)(5)(F)(vi), except 
that in applying such meaning any reference under such 
subsection to individuals entitled to supplementary 
security income under title XVI shall be deemed for 
purposes of this subparagraph to include individuals--
``(I) eligible for medical assistance under 
a State plan under title XIX; or
``(II) receiving aid or assistance under 
any plan of the territory approved under title 
I, X, XIV, or XVI.''.

Subtitle B--Part B

SEC. 211. ELIMINATING LATE ENROLLMENT PENALTIES UNDER PART B OF THE 
MEDICARE PROGRAM FOR CERTAIN INDIVIDUALS RESIDING IN 
PUERTO RICO.

(a) In General.--Section 1839(b) of the Social Security Act (42 
U.S.C. 1395r(b)) is amended in the second sentence by inserting ``or 
months occurring in the 5-year period beginning on the date on which 
the individual becomes entitled to benefits under part A if such 
individual was residing in Puerto Rico as of such date and such date is 
after the date that is 4 years before the date of the enactment of the 
Territories Health Equity Act of 2025'' before the period at the end of 
such sentence.
(b) Application.--The amendment made by subsection (a) shall apply 
with respect to premiums paid for months beginning on or after the date 
of the enactment of this Act.

Subtitle C--Medicare Advantage (Part C)

SEC. 221. ADJUSTMENT IN BENCHMARK FOR LOW-BASE PAYMENT COUNTIES IN 
PUERTO RICO.

Section 1853(n) of the Social Security Act (42 U.S.C. 1395w-23(n)) 
is amended--
(1) in paragraph (1), by striking ``and (5)'' and inserting 
``(5), and (6)'';
(2) in paragraph (4), by striking ``In no case'' and 
inserting ``Subject to paragraph (6), in no case''; and
(3) by adding at the end the following new paragraph:
``(6) Special rules for blended benchmark amount for 
territories.--
``(A) In general.--Subject to paragraph (2), the 
blended benchmark amount for an area in a territory for 
a year (beginning with 2026) shall not be less than 80 
percent of the national average of the base payment 
amounts specified in subparagraph (2)(E) for such year 
for areas within the 50 States and the District of 
Columbia.
``(B) Limitation.--In no case shall the blended 
benchmark amount for an area in a territory for a year 
under subparagraph (A) exceed the lowest blended 
benchmark amount for any area within the 50 States and 
the District of Columbia for such year.''.

Subtitle D--Part D

SEC. 231. AUTOMATIC ELIGIBILITY OF CERTAIN LOW-INCOME TERRITORIAL 
RESIDENTS FOR PREMIUM AND COST-SHARING SUBSIDIES UNDER 
THE MEDICARE PROGRAM; SUNSET OF ENHANCED ALLOTMENT 
PROGRAM.

(a) Automatic Eligibility of Certain Low-Income Territorial 
Residents for Premium and Cost-Sharing Subsidies Under the Medicare 
Program.--
(1) In general.--Section 1860D-14(a)(3) of the Social 
Security Act (42 U.S.C. 1395w-114(a)(3)) is amended--
(A) in subparagraph (B)(v)--
(i) in subclause (I), by striking ``and'' 
at the end;
(ii) in subclause (II), by striking the 
period and inserting ``; and''; and
(iii) by inserting after subclause (II) the 
following new subclause:
``(III) with respect to plan years 
beginning on or after January 1, 2026, 
shall provide that any part D eligible 
individual who is enrolled for medical 
assistance under the State Medicaid 
plan of a territory (as defined in 
section 1935(f)) under title XIX (or a 
waiver of such a plan) shall be treated 
as a subsidy eligible individual 
described in paragraph (1).''; and
(B) in subparagraph (F), by adding at the end the 
following new sentence: ``The previous sentence shall 
not apply with respect to eligibility determinations 
for premium and cost-sharing subsidies under this 
section made on or after January 1, 2026.''.
(2) Conforming amendment.--Section 1860D-31(j)(2)(D) of the 
Social Security Act (42 U.S.C. 1395w-141(j)(2)(D)) is amended 
by adding at the end the following new sentence: ``The previous 
sentence shall not apply with respect to amounts made available 
to a State under this paragraph on or after January 1, 2026.''.
(b) Sunset of Enhanced Allotment Program.--
(1) In general.--Section 1935(e) of the Social Security Act 
(42 U.S.C. 1396u-5(e)) is amended--
(A) in paragraph (1)(A), by inserting after ``such 
State'' the following: ``before January 1, 2026''; and
(B) in paragraph (3)--
(i) in subparagraph (A), in the matter 
preceding clause (i), by inserting after ``a 
year'' the following: ``(before 2026)''; and
(ii) in subparagraph (B)(iii), by striking 
``a subsequent year'' and inserting ``each of 
fiscal years 2010 through 2025''.
(2) Territory defined.--Section 1935 of the Social Security 
Act (42 U.S.C. 1396u-5) is amended by adding at the end the 
following new subsection:
``(f) Territory Defined.--In this section, the term `territory' 
means Puerto Rico, the Virgin Islands, Guam, the Northern Mariana 
Islands, and American Samoa.''.

TITLE III--MISCELLANEOUS

SEC. 301. MEDICAID AND CHIP TERRITORY TRANSPARENCY AND INFORMATION.

(a) Publication of Information on Federal Expenditures Under 
Medicaid and CHIP in the Territories.--Not later than 180 days after 
the date of the enactment of this Act, the Secretary of Health and 
Human Services shall publish, and periodically update, on the internet 
site of the Centers for Medicare & Medicaid Services information on 
Medicaid and CHIP carried out in the territories of the United States. 
Such information shall include, with respect to each such territory--
(1) the income levels established by the territory for 
purposes of eligibility of an individual to receive medical 
assistance under Medicaid or child health assistance under 
CHIP;
(2) the number of individuals enrolled in Medicaid and CHIP 
in such territory;
(3) any State plan amendments in effect to carry out 
Medicaid or CHIP in such territory;
(4) any waiver of the requirements of title XIX or title 
XXI issued by the Secretary to carry out Medicaid or CHIP in 
the territory, including a waiver under section 1115 of the 
Social Security Act (42 U.S.C. 1315), any application for such 
a waiver, and any documentation related to such application 
(including correspondence);
(5) the amount of the Federal and non-Federal share of 
expenditures under Medicaid and CHIP in such territory;
(6) the systems in place for the furnishing of health care 
items and services under Medicaid and CHIP in such territory;
(7) the design of CHIP in such territory; and
(8) other information regarding the carrying out of 
Medicaid and CHIP in the territory that is published on such 
internet site with respect to carrying out Medicaid and CHIP in 
each State and the District of Columbia.
(b) Definitions.--In this section:
(1) CHIP.--The term ``CHIP'' means the State Children's 
Health Insurance Program under title XXI of the Social Security 
Act.
(2) Medicaid.--The term ``Medicaid'' means the Medicaid 
program under title XIX of the Social Security Act.
(3) Territory.--The term ``territory of the United States'' 
includes Puerto Rico, the Virgin Islands of the United States, 
Guam, the Northern Mariana Islands, and American Samoa.

SEC. 302. REPORT ON EXCLUSION OF TERRITORIES FROM EXCHANGES.

(a) In General.--Not later than February 1, 2026, the Secretary of 
Health and Human Services shall submit to Congress a report that 
details the adverse impacts in each territory from the practical 
exclusion of the territories from the provisions of part II of subtitle 
D of title I of the Patient Protection and Affordable Care Act insofar 
as such provisions provide for the establishment of an American Health 
Benefit Exchange or the administration of a federally facilitated 
Exchange in each State and in the District of Columbia for the purpose 
of making health insurance more affordable and accessible for 
individuals and small businesses.
(b) Information in Report.--The report shall include information on 
the following:
(1) An estimate of the total number of uninsured and 
underinsured individuals residing in each territory with 
respect to health insurance coverage.
(2) A description of the number of health insurance issuers 
in each territory and the health insurance plans these issuers 
offer.
(3) An estimate of the number of individuals residing in 
each territory who are denied premium and cost-sharing 
assistance that would otherwise be available to them for 
obtaining health insurance coverage through an Exchange if they 
resided in one of the 50 States or in the District of Columbia.
(4) An estimate of the amount of Federal assistance 
described in paragraph (3) that is not being made available to 
residents of each territory.
(5) An estimate of the number of small employers in each 
territory that would be eligible to purchase health insurance 
coverage through a Small Business Health Options Program (SHOP) 
Marketplace that would operate as part of an Exchange if the 
employers were in one of the 50 States or in the District of 
Columbia.

SEC. 303. ACCESS TO COVERAGE FOR INDIVIDUALS IN CERTAIN AREAS WITHOUT 
ANY AVAILABLE EXCHANGE PLANS.

Part 2 of subtitle D of title I of the Patient Protection and 
Affordable Care Act (42 U.S.C. 18031 et seq.) is amended by adding at 
the end the following:

``SEC. 1314. ACCESS TO COVERAGE FOR INDIVIDUALS IN CERTAIN AREAS 
WITHOUT ANY AVAILABLE EXCHANGE PLANS.

``(a) In General.--
``(1) Coverage through dc exchange.--Not later than 3 
months after the date of enactment of this section, the 
Secretary, in consultation with the Secretary of the Treasury 
and the Director of the Office of Personnel Management, shall 
establish a mechanism to ensure that, for any plan year 
beginning on or after the date described in subsection (c), any 
individual described in paragraph (2) has access to health 
insurance coverage which is at least as broad as the coverage 
available to Members of Congress and congressional staff (as 
defined in section 1312(d)(3)(D)) through the Exchange 
operating in the District of Columbia. Such individuals shall 
be eligible for any premium tax credit under section 36B of the 
Internal Revenue Code of 1986, reduced cost sharing under 
section 1402, and advance determination and payment of such 
credits or such reductions under section 1412 to be 
administered by the Secretary, in consultation with the 
Secretary of the Treasury and the Director of the Office of 
Personnel Management. The District of Columbia, its residents, 
and small businesses shall be held harmless from any increased 
costs resulting from the enactment of this section.
``(2) Individual described.--An individual described in 
this paragraph is any individual who--
``(A) is not eligible to enroll in an employer-
sponsored health plan (excluding such a plan that would 
not be considered minimum essential coverage due to the 
application of subparagraph (C) of section 36B(c)(2) of 
the Internal Revenue Code of 1986 if such subparagraph 
applied to such plan); and
``(B) is a bona fide resident of any possession of 
the United States (as determined under section 937(a) 
of such Code) in which the Secretary certifies that no 
qualified health plan is offered through an Exchange 
established under this title.
``(3) Possession of the united states.--For purposes of 
this section, the term `possession of the United States' shall 
include such possessions as are specified in section 937(a)(1) 
of the Internal Revenue Code of 1986.
``(b) Treatment of Possessions.--
``(1) Payments to possessions.--
``(A) Mirror code possession.--The Secretary of the 
Treasury shall periodically (but not less frequently 
than annually) pay to each possession of the United 
States with a mirror code tax system amounts equal to 
the loss to that possession by reason of the 
application of this section (determined without regard 
to paragraph (2)) with respect to taxable years 
beginning after the date described in subsection (c). 
Such amounts shall be determined by the Secretary of 
the Treasury based on information provided by the 
government of the respective possession.
``(B) Other possessions.--The Secretary of the 
Treasury shall periodically (but not less frequently 
than annually) pay to each possession of the United 
States which does not have a mirror code tax system 
amounts estimated by the Secretary of the Treasury as 
being equal to the aggregate benefits that would have 
been provided to residents of such possession by reason 
of the application of this section for any taxable 
years beginning after the date described in subsection 
(c) if a mirror code tax system had been in effect in 
such possession. The preceding sentence shall not apply 
with respect to any possession of the United States 
unless such possession has a plan, which has been 
approved by the Secretary of the Treasury, under which 
such possession will promptly distribute such payments 
to the residents of such possession.
``(2) Coordination with credit allowed against united 
states income taxes.--No credit shall be allowed against United 
States income taxes for any taxable year under section 36B of 
the Internal Revenue Code of 1986 to any person--
``(A) to whom a credit is allowed against taxes 
imposed by the possession by reason of this section 
(determined without regard to this paragraph) for such 
taxable year, or
``(B) who is eligible for a payment under a plan 
described in paragraph (1)(B) with respect to such 
taxable year.
``(3) Mirror code tax system.--For purposes of this 
subsection, the term `mirror code tax system' means, with 
respect to any possession of the United States, the income tax 
system of such possession if the income tax liability of the 
residents of such possession under such system is determined by 
reference to the income tax laws of the United States as if 
such possession were the United States.
``(4) Treatment of payments.--For purposes of section 
1324(b)(2) of title 31, United States Code, or any similar rule 
of law, the payments under this subsection shall be treated in 
the same manner as a refund due from the credit allowed under 
section 36B of the Internal Revenue Code of 1986.
``(c) Date Described.--The date described in this subsection is the 
date on which the Secretary establishes the mechanism described in 
subsection (a)(1).''.
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